WSR 07-11-164

PREPROPOSAL STATEMENT OF INQUIRY

EMPLOYMENT SECURITY DEPARTMENT


[ Filed May 23, 2007, 9:50 a.m. ]

Subject of Possible Rule Making: Adopting and amending rules to implement the portions of ESSB 5373 (chapter 146, Laws of 2007) regarding professional employer organizations (PEOs) and client employers. The subject includes how unemployment insurance relates to PEOs and client employers.

Statutes Authorizing the Agency to Adopt Rules on this Subject: RCW 50.12.010 and 50.12.040.

Reasons Why Rules on this Subject may be Needed and What They Might Accomplish: Rules are needed for implementation of ESSB 5373 (chapter 146, Laws of 2007), primarily sections 9 to 17. The statute provides generally for registration and taxation of PEOs and client employers for purposes of unemployment insurance.

Other Federal and State Agencies that Regulate this Subject and the Process Coordinating the Rule with These Agencies: The United States Department of Labor (USDOL) reviews the state's administration of the unemployment insurance program to ensure conformity to federal statutes and regulations. The state has broad flexibility in the implementation of unemployment insurance laws as long as conformity is maintained. The proposed regulations will be shared with USDOL prior to adoption.

In addition, proposed regulations will be shared with the state department of revenue and department of labor and industries, both of which may regulate PEOs and client employers for purposes other than unemployment insurance.

Process for Developing New Rule: The department will hold public meetings to obtain and consider public and stakeholder input prior to filing the proposed rules. In addition, there will be a mailing to stakeholders identified in the rule-making process and written comments from stakeholders will be considered.

Interested parties can participate in the decision to adopt the new rule and formulation of the proposed rule before publication by contacting Juanita Myers, Unemployment Insurance Rules Coordinator, Employment Security Department, P.O. Box 9046, Olympia, WA 98507-9046, phone (360) 902-9665, fax (360) 902-9799, e-mail jmyers@esd.wa.gov. Please include your name, organization (if any), mailing address, e-mail address, and telephone number.

May 22, 2007

Paul Trause

Deputy Commissioner

Washington State Code Reviser's Office